Morality and the Minimum Wage

Were America to be invaded by a massive foreign force and all able-bodied, law-abiding citizens called upon to act courageously in defense of our common homeland, would it not then seem a vulgar injustice after repelling this formidable enemy were any such patriots then relegated to working at wages below a level providing even a subsistence lifestyle — while yet others returned to their newly secured private wealth and their well-paying positions? Ought not the diligence and the integrity that protects and preserves the free enterprise system for all citizens at least earn for hard-working individuals an escape from a life of dependency, indebtedness and drudgery?

Here our common values and our underlying morality are on trial. Does honest work merit an honest pay? Is there inherent value in integrity and hard work? Let us leave aside for the moment those who free ride upon society and even those who bring children into poverty. Must single working Americans in order to live independently as adults toil at more than one job, live with relatives, and assume personal debt for training and education — all as the price for survival in a supposedly just nation?

Might this be where a free market forces the hand of the invisible individual?

Is modest living and quiet dignity then impossible, or perhaps just unacceptable, for those who, though their skills are limited, would yet be content with their lives? Must fast food workers and janitors be ashamed of their stations? Ought we pity them? And is the price of being an American that all must ambitiously scramble toward the next tax bracket?

Instituting a minimum wage sufficient to guarantee a law-abiding full-time single worker his basic needs — food, shelter, clothing — would stand as proof that we Americans value the very values that sustain us. This would not, however, be a redistributive scheme for expropriating all wealth. Nor would any direct transfer of either an interest in, or the control of, private property be defensible — let alone feasible.

In fact with any hypothetical employee or stockholder control of business a more wasteful use of resources would likely follow: as each citizen would vote for his own self-interests, interests determined by both short-sighted and far-sighted perspectives and by the individual’s share of common sense — or lack of any. The result would be an averaging out of good with bad ideas. While the decision-making of a CEO is more often directed by experience and by a single-minded, highly competitive and so, more often than not, efficient use of resources.

By no means, though, ought the nation’s highest goal be the greatest economic output. Capitalism may indeed deliver the most efficient use of resources and provide us the highest floor of subsistence for all. But is this necessarily moral — or even wise? Ought irreversible environmental damage and mass species extinction be of eventual concern to us? And ought our system be measured by quantity of human life, instead of by the quality of it?

The idea of putting more capital into more hands, as the minimum wage seemingly would do, isn’t necessarily a desirable goal in itself. This would undoubtedly accelerate the destructive exploitation of our natural world through an overproduction of material goods. With more income most people would simply purchase more products and services — each requiring its own natural resources. And thanks to their marginal increase in wealth, some people would also have larger families — children who would themselves consume additional resources.

So what’s so good about a minimum wage then? Isn’t the consequent overpopulation and environmental destruction also immoral? Yes, of course it is. But because the minimum wage sets the wage floor artificially high — i.e. higher than would support the fullest employment possible — it also limits job opportunities and so exerts pressure on those who cannot afford children not to have them: it thereby moderates both population growth and economic growth — this otherwise-destructive, immoral, runaway economic growth — even as it rightly rewards honest work.

That our government currently provides a ready alternative to low-skill, low-wage labor in the form of welfare programs — food stamps, unemployment insurance, etc. — only rewards people for not working, for bringing more children into poverty, and for scamming honest citizens. These safety-net provisions would have to be sunsetted over the course of no more than a few generations, so that each successive generation would face increasingly fewer alternatives to responsible family planning and honest full-time work.

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Value itself is subjective. But values are indispensable. Honesty and hard work ought not be relegated to an economic model of subjective valuation. It stretches credulity to believe that the salary of a CEO is 500 times greater than the company’s lowest-paid laborers; either because the market “demands” such an arrangement, where in other companies it apparently does not; or because this disparity reflects an objectively demonstrable, just valuation of his unique contributions to the survival of the enterprise — as though CEOs, with their obnoxious salaries, weren’t often replaced.

The entire compensation system of the mid-sized or larger company could adjust to accommodate a higher minimum wage, as anyone who has any experience with the wasted time and resources, the general incompetence and the typical redundancy inside most companies could confirm. There are also fortunes spent on ineffective advertising and government lobbying — another advantage of direct democracy — and the consequent tax shelters and special provisions in law. Suffice it to say that most companies are grossly inefficient.

The federal minimum wage acts with a blind uniformity and with a public transparency. It helps those who are actively helping themselves. A regionalized CPI could be used to determine a level for the minimum wage that would provide a local resident sufficient means to afford the necessities of life in his area, as represented by a “basket” of goods and services that all independent, hardworking Americans deserve.

The most obvious alternatives to a moral minimum wage are to continue this amoral welfare state, which now threatens the fiscal life of the nation; or to be rid of the welfare state altogether and the minimum wage with it: Let then the free market flex its invisible hand. Perhaps all honest, low-skilled, hardworking Americans would earn only two dollars an hour; but the price of basic needs might drop in some relation to the lowered cost of labor; such that marginally more poor people could live in relatively more widespread poverty. And the planet could be exploited and overrun until we’re all equally damned.

Or we might express our sounder values through our policies and our polity. We might institute a moral minimum wage and ratify a direct democracy.